CIBT Provides Update on its $60 Million Raise for the GEC Education Mega Center Project
Vancouver, B.C., July 6, 2021 – CIBT Education Group Inc. (TSX: MBA, OTCQX International: MBAIF) (“CIBT” or the “Company“) reports that further to its news release dated March 2, 2021 regarding its plans to raise $60 million for the GEC® flagship project, the Education Mega Center (the “Project”), a subsidiary of the Company has signed a non-binding term sheet with an independently owned mortgage lender and investment fund manager committing up to $50 million by way of loans and an equity or equity-like investment in the Project. The parties are working diligently to finalize a formal loan and investment agreement in the coming months. The remaining financing of the Project is expected to be progressive in that the offering price of each limited partnership unit offering will increase in phases consistent with the construction progress. The Company will continue to finalize the remaining procedures required by the City of Surrey to issue the Development and Building Permits in the coming months. Demolition of the building previously occupying the Project site is completed.
About GEC Education Mega Center®:
A subsidiary limited partnership of CIBT acquired the Project site in downtown Surrey on August 30, 2019. The Company expended substantial efforts through several value-engineering exercises to reduce costs and increase efficiencies. The Project received approval from Surrey’s Urban Design Panel in December 2020, Public Hearing 1 and 2 approval on February 8, 2021, and Public Hearing 3 approval on February 22, 2021. The total purchase price was $22.6 million, excluding closing costs. An appraisal report by an independent appraiser dated August 31, 2020, valued the property at $50.48 million. Given the date of the report, the valuation did not factor in the rezoning approvals received from September 2020 to February 2021, which increased the land use density from 0.4x to 9.0x, as well as current market conditions.
The Project will be a 49-storey concrete mixed-used commercial and residential building with 41 residential floors, 6 commercial and retail floors, 2 amenity floors, and 7 underground parking levels. The building design stands 542 feet tall, making it the fourth tallest building in Metro Vancouver. The Project will comprise 404,249 square feet with 787 bedrooms, including 112 studio units, and accommodates up to 982 occupants. The upper floors will be allocated for residential rental housing and the middle floors for student-centric rental apartments and corporate housing. The lower six floors will accommodate at least five colleges and universities looking to expand their Surrey City Centre presence and a cafeteria-style restaurant with a premium food market on the ground floor. The Project’s total development budget is approximately $270 million, land cost included.
School tenants located at the Project will share the amenity floors, including dining areas, student lounges, electronic library, video-conferencing and meeting rooms. Such sharing arrangement reduces the operating cost for all the schools. Most importantly, students attending their schools can reside upstairs from the schools, saving them time and money, with increased safety. GEC Education Mega Center® could also provide much-needed rental housing to the students studying at the Simon Fraser University Surrey Campus, only 150 metres from the Project. The Kwantlen Polytechnic University Surrey Central Campus is within 80 metres of the Project. The Project could also provide rental housing to the estimated 10,000 workers anticipated to be employed in the expanded Surrey Central Business District (Newslink: https://dailyhive.com/vancouver/surrey-central-station-centre-block-redevelopment) directly across the street. Other public amenities such as the Surrey SkyTrain station are 20 metres away, 100 metres from the Central City Shopping Centre and the Surrey Civic Library with the Surrey City Hall adjacent to it.
The Surrey campus of the Company’s education subsidiary, Sprott Shaw College, currently occupies over 10,000 square feet in central Surrey. The plan is to relocate the Sprott Shaw College (Surrey) campus to the Education Mega Center® as an anchor tenant. The Company has been in discussions with numerous universities and colleges from across Canada and abroad and has received tremendous interest in the Project.
About CIBT Education Group:
CIBT is one of Canada’s largest education services and academic real estate companies. With a global presence since 1994, CIBT employs nearly 600 staff at 46 business locations and operates a global network of 2,500 recruitment agents. In 2020, the group provided education, recruitment and accommodation services to over 11,000 students. Its real estate portfolio, including operating assets and development budget, exceeds $1.5 billion.
CIBT’s education subsidiaries include Sprott Shaw College (established in 1903), Sprott Shaw Language College, Vancouver International College Career Campus, CIBT School of Business and Global Education Alliance. These subsidiaries offer over 150 accredited educational programs in healthcare, business, e-commerce, cyber-security, hotel management, language training and recruitment services at 29 locations in Canada and abroad.
CIBT’s real estate subsidiary, Global Education City Holdings Inc. (“Global Holdings“), develops and manages academic-assets such as student-centric rental apartments, corporate housing, hotel and education super-centres. Under the GEC® brand, Global Holdings provides B2B accommodation service to 90 schools in Metro Vancouver and B2C service to students from 70 countries. The GEC® branded portfolio, including operational and under-construction or development, comprises 11 projects, 16 buildings, spanning over 1.5 million square feet.
CIBT also owns Irix Design Group Inc. (“Irix Design“). Irix Design is a leading design and advertising company services over one hundred corporate clients, including CIBT. Visit us online at www.cibt.net.
Chairman, President & CEO
CIBT Education Group Inc.
Investor Relations Contact: 1-604-871-9909 extension 319 or | Email: email@example.com
Some statements in this news release contain forward-looking information (the “forward-looking statements“) about CIBT Education Group Inc. and its plans. Forward-looking statements are statements that are not historical facts. Forward-looking statements in this news release include (without limitation) statements about financing plans to raise funds for the construction of the proposed GEC Education Mega Center®, the expectation that the Project will be completed, the expectation that the Project will house at least five universities and colleges, the anticipated number of workers to be employed at the proposed redeveloped Surrey Central Business District and the possibility that the Project might house some of those workers. Forward-looking statements are subject to various risks, uncertainties and other factors that could cause CIBT’s actual results or achievements to differ materially from those expressed in or implied by forward-looking statements. Forward-looking statements are based on the beliefs, opinions and expectations of CIBT’s management at the time they are made, and CIBT does not assume any obligation to update its forward-looking statements if those beliefs, opinions or expectations, or other circumstances should change, except as may be required by law.